Rollo, F.A. v Morrow, P.D - [1992] FCA 513

Re: FREDERICK ARTHUR ROLLO
And: PAUL DAMIEN MORROW; CATHERINE ANNE MURPHY and JOSEPH RACE EASTMURE
No. N G785 of 1991
FED No. 513
Income Tax - Administrative Law
(1992) 92 ATC 4364
(1992) 23 ATR 477

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Gummow J.(1)

CATCHWORDS

Income Tax - release from liability to pay tax - "serious hardship" - exercise of discretion - Income Tax Assessment Act 1936, s. 265.

Administrative Law - procedural fairness - oral hearing - whether necessary.

HEARING

SYDNEY

#DATE 17:7:1992

Counsel and Solicitors
for the Applicant: Mr R.J. Bainton QC and

Mr S.J. McMillan instructed by Messrs J.W. Walker and D.K.L. Raphael

Counsel and Solicitors
for the Respondent: Mr Alan Robertson instructed

by the Australian Government Solicitor

ORDER

THE COURT ORDERS THAT:

1. The application is dismissed.

2. The applicant pay the costs of the respondent.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is an application for an order of review under the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act") to review the decision of the respondents, constituting the Taxation Relief Board ("the Board"), made on 6 November 1991, pursuant to s. 265 of the Income Tax Assessment Act 1936 ("the Tax Act"). The decision was that relief should not be granted from any liability of the applicant to income tax and additional tax assessed and payable by him in respect of five years of income, 1979-1983 inclusive.

The Board was satisfied that payment of the full amount of tax would cause the applicant serious hardship, but it decided to exercise its discretion against the grant of relief. The applicant accepts that the finding of a serious hardship did not oblige the Board to exercise its discretion in favour of the applicant; see Powell v Evreniades (1989) 21 FCR 252; Van Grieken v Veilands (1991) 103 ALR 233 at 236.
On 16 May 1988 the applicant made a declaration in support of his application under s. 265. An examination of the applicant on oath was conducted on 29 November 1989 by a "designated person", within the meaning of provisions in s. 265 to which I will later refer. A written report on the examination, dated 29 November 1989, was sent to the Board. On 23 April 1990 the Board, whilst concluding the payment of the full amount of tax would cause serious hardship, decided against a release from any of the tax liability. An application for an order of review under the ADJR Act was then instituted in this Court by the applicant (matter number G690 of 1990). On 12 April 1991 the proceeding was settled by consent orders. These set aside the decision of 23 April 1990 and remitted the application under s. 265 to a differently constituted Board, for reconsideration. Counsel for the respondents in the present application makes the point that although there have been two proceedings in…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Rollo, F.A. v Morrow, P.D

Details

AGLC: Rollo, F.A. v Morrow, P.D [1992] FCA 513
Case: [1992] FCA 513
Decision Date: 17 JULY 1992

CaseChat Overview and Summary

In the Federal Court of Australia, the matter of Rollo, F.A. v Morrow, P.D. involved an application by the applicant, F.A. Rollo, seeking a release from liability to pay tax under section 265 of the Income Tax Assessment Act 1936. The respondent, P.D. Morrow, opposed the application, arguing that the criteria for serious hardship had not been met. The court was tasked with determining whether the Commissioner of Taxation had correctly exercised his discretion in denying the applicant's request for relief.

The legal issue before the court was whether the Commissioner had correctly exercised his discretion under section 265 of the Income Tax Assessment Act 1936 in refusing to grant the applicant relief from tax liability. The applicant argued that the Commissioner's decision was flawed, and that the applicant had demonstrated sufficient serious hardship to warrant relief. The court had to examine the evidence presented and consider the statutory criteria for serious hardship as well as any relevant case law.

After a thorough review of the evidence and applicable legal principles, the court found that the Commissioner had exercised his discretion correctly. The court determined that the applicant had not demonstrated the requisite serious hardship to warrant relief from tax liability. The court held that the Commissioner's decision was well within the bounds of the statutory framework and was not made in an arbitrary or irrational manner. Consequently, the court dismissed the applicant's application and ordered the applicant to pay the respondent's costs.

The final orders of the court were that the application for relief from tax liability was dismissed and that the applicant pay the costs of the respondent. The court's decision underscored the stringent criteria required for the exercise of discretion under section 265 of the Income Tax Assessment Act 1936, and reaffirmed the importance of the Commissioner's role in ensuring tax liabilities are met fairly and in accordance with the law.

Orders

Orders of the court

THE COURT ORDERS THAT:

1. The application is dismissed.

2. The applicant pay the costs of the respondent.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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